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SHIP RECYCLING

Ship Recycling

Where Ships Go to Die & Gain a New Lease on Life

By Tom Mulligan

106 Maritime Reporter & Engineering News • NOVEMBER 2015

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hipowners stand to recoup a substantial amount of their in-vestment by selling ships for recycling,

and the cheaper the recycling pro-cess, the more they make on steel. But bad breaking practices can cost more than just money and the shipping industry still has major ethical, moral, environmental and publicity issues to resolve when it comes to ship recycling. A recent IMMEDIASEA Shipping Debate Forum gave the watchdogs and the watched alike an opportunity to promote responsible practices as well as highlight persisting problems and the need for further change.

“In the beaching yards of Bangladesh, there is extensive pollution and no haz-ardous waste management. Workers ex-perience poor working and living con-ditions and fatal accidents are a regular occurrence. Children and adolescents make up about one-fi fth of the work-force, which is exposed to a high risk of cancer and occupational diseases. Another problem is the sheer scale of the task at hand, work being completed without heavy lifting equipment, struc-tural supports or scaffolding, and there being virtually no mechanization. Dan-gerous conditions and practices also in-clude poor downstream waste manage-ment, and the impossibility of containing pollutants on a tidal beach. There have been no substantial improvements on the ground.”

This is how Patrizia Heidegger, Execu-tive Director of the NGO Shipbreaking Platform, described Bangladeshi ship re-cycling conditions.

“The extent of workers injuries points out once again the total disregard on the employers’ part for workers’ safety,” she said. “Ship-breaking yards in Chittagong are notorious for terrible work condi-tions and frequent accidents. Just this year, fi ve workers have been killed in ac-cidents and many have been severely in-jured at various shipyards in the district.

“It is unacceptable that an industry as huge and risk-prone as ship-breaking should still be in such a primitive state that allows these horrible accidents to occur. The apathy and negligence dem-onstrated by employers violate basic labor laws that make it mandatory for workplaces to maintain minimum safety standards.”

The NGO Shipbreaking Platform is a global coalition of environmental, hu-man and labor rights NGOs seeking to prevent dirty and dangerous shipbreak-ing practices and promoting clean, safe

and just ship recycling. Heidegger cited its main achievements as putting ship re-cycling on the international agenda, with international and EU legislation now in place, greater awareness of the issues

and industry transparency, and progres-sive shipowners and cargo-owners now demanding clean and safe recycling.

“More and more end-of-life vessels are now being recycled, a record number of

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about 1,300 large ocean-going vessels being recycled in 2012,” she said. “There are still a number of legal grey zones, for example the Hong Kong Convention for the Safe and Environmentally Sound Re-cycling of Ships 2009 is not in force, the

EU Ship Recycling Regulation is not ap-plicable in many cases, export bans are often circumvented, and domestic law in these countries is weak or not imple-mented.

A major problem is that the majority

of shipowners do not feel responsible. However, there are a number of best-practice examples, including Norwegian and Dutch ship owners, Maersk, Hapag Lloyd, Royal Dutch Boskalis, and oil and gas companies.”

Another View on Ship Recycling“It is important to be aware of the re-

ality and other perceptions in ship recy-cling,” said Nikos Mikelis of GMS Inc, a major purchasing company of ships for recycling. “The recent announcement by

SHIP RECYCLING

“Independent and qualifi ed third-party supervision in the process of green recycling can assist responsible owners to achieve the objectives of green recycling”

Rakesh Bhargava, Head of Lay-up, Green Recycling & IHM Services at Wilhelmsen Ship Management(Ph

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Workers handling waste in Chittagong, Bangladesh.

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the Norwegian Shipowners Association that their members should not recycle their ships by the beaching method ap-pears to vindicate the long campaigns of the NGO Platform, and also the position that was adopted by the Green Party of the European Parliament for an outright ban of beaching,” he continued. “It also provides ample support to the European Commission on the viability of exclud-ing all beaching yards in South Asia for the recycling of European-fl agged ships. However well-meaning NSA’s announcement may have been, it seri-ously undermines the improvements that are already taking place in South Asia’s ship recycling industry. It also poses a question-mark over the feasibility of achieving a global regulatory regime for ship recycling under the standards of the Hong Kong Convention.

“The basis of the Convention is the recognition that shipping is a truly in-ternational business and, therefore, for a regulatory regime to be effective, it would have to have global application. Furthermore, as just fi ve countries, con-sistently in the past 15 years, have recy-cled 97 percent of the world’s recycled tonnage, the implementation of the Con-vention on a truly global basis is practi-cally achievable.

“During the development of the Con-vention, the debate at IMO concluded that beaching should not be banned, because there is no evidence to sug-gest that ships cannot be recycled safely and cleanly on the beach; that banning of beaching would exclude 70% of the world’s recycling capacity from the scope of the Convention and therefore it would thus fail to become a global stan-dard; and banning of beaching would exclude the whole of South Asia, which is the region most in need for improved standards of safety and environmental protection,” Mikelis said.

Stating the FactsNinety-fi ve percent of a vessel’s

components are reused when a ship is scrapped. According to Gerhard Aulbert, Global Head of Practice Ship Recycling at advisory and consultancy company DNV GL, every year up to about 1,500 ships are recycled to rejuvenate the world fl eet and regain valuable second-ary resources such as steel, aluminum and copper. The majority of these ves-sels are recycled in Asian countries such as India, Pakistan, Bangladesh and Chi-na, with a smaller share going to yards in Turkey.

“The conditions under which recycling facilities dismantle the vessels vary,” he said. “Depending on the yard, basic

equipment such as helmets, shoes, pro-tective gloves and masks are not provid-ed to all workers. Hazardous materials such as heavy metals and fuel oils leak into the surf and the soil, polluting the area and creating serious health hazards

for people working on-site. “While there have been efforts to reg-

ulate the handling and disposal of haz-ardous materials, as in the Basel Con-vention 1989, and improve safety and environmental standards in ship recy-

cling facilities, such as the Hong Kong Convention, they have proven to be dif-fi cult to enforce,” he added. “For exam-ple, the Hong Kong Convention has only been ratifi ed by three countries and is not expected to enter into force before 2020,

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eleven years after it was adopted by the International Maritime Organization.

“Progress has been very slow un-til now. But the implementation of the European Ship Recycling Regulation will bring about some radical changes

over the next few years. Of the roughly 60,000 ships worldwide, about two-thirds are affected by it.”

Green Recycling, White-ListedRakesh Bhargava, Head of Lay-up,

Green Recycling and IHM Services at Wilhelmsen Ship Management, de-scribed how the EU Ship Recycling Reg-ulation dictates strict terms and condi-tions for green recycling in pre-approved white-listed ship yards. It was signed

and approved by the EU Parliament and in force from December 2013 with com-panies needing to comply by December 2015. It applies to all EU-fl agged vessels as well as vessels anchoring or visiting European ports. The main impact is that

SHIP RECYCLING

“More and more end-of-life vessels are now being recycled, a record number of about 1,300 large ocean-going vessels being recycled in 2012”

Patrizia Heidegger, Executive Director of the NGO Shipbreaking Platform

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Barrels on shore in Chittagong, Bangladesh.

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Just fi ve countries, Bangladesh, India, Pakistan, China and Turkey, perform 97% of the world’s ship recycling. Bangladesh, India and Pakistan alone ac-count for 70% of global business. The reason for this? It is due to the economics of steel production. Nikos Mikelis of GMS explains:

“The primary locations where ships are recycled are places where ferrous scrap is needed to be im-ported for making steel. Of course it is uneconomic for a small or damaged ship to sail thousands of miles to reach the main ship recycling centers, and for this reason ship recycling facilities also exist in many countries which have no need for ferrous scrap. Ship recycling in such cases can be seen as a service for disposing end-of-life ships, rather than

an industry driven by the economics of steel mak-ing. Chinese imports of scrap steel have declined steeply and in this period the Chinese ship recycling industry has been surviving thanks to the govern-ment’s policy to renew the Chinese fl eet through substantial ‘scrap and build’ subsidies offered to Chinese shipowners. China does not allow beaching of ships and most yards are located on rivers with ships most often moored alongside a pier.”

“Turkey is characterized by little usage of iron ore in its steel-making and by high demand for scrap steel. It has been, and it continues to be, the world’s largest importer of scrap steel. In Turkey there is no rerolling of scrap steel, nor a vibrant second-hand market in equipment and machinery. Ship recycling

in Turkey is restricted to a single beach in Aliaga, 60 km north of Izmir, where there are 22 recycling yards, each with about 50 meters’ frontage to the beach. Turkey’s capacity represents around 4 per-cent to 5 percent of the world’s recycling capacity.

Pakistan produces little new steel, and most of this is by using iron ore. Nevertheless Pakistan’s ship recycling industry has been growing fast in recent years, providing steel to the rerolling market, while enjoying the benefi t of second-hand markets for ma-chinery, equipment, spare parts, etc.

Bangladesh currently does not produce new steel. Its ship recycling industry provides scrap steel for the rerolling market which is very active due to the urbanization of this very densely populated country.

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SHIP RECYCLING

“I think we will see more of a division between the practice of recycling itself and the sale of recycled materials. At the moment, this is often still done by one and the same facility and shipowners often choose one that will fetch them a higher price for the recycled steel.”

Gerhard Aulbert, Global Head of Practice Ship Recycling, DNV GL

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Below: Workers on a partially dismantled vessel in Gadani, Pakistan.

Right: Sludge on Gadani beach, Pakistan.

Below Right: Dumped toxic waste in Gadani, Pakistan.

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it requires an IHM, a detailed document outlaying all potentially hazardous ma-terial onboard a vessel, for all vessels calling at European ports, and that green recycling will be mandatory for all EU-fl agged vessels from 2015. By the end of 2016, all EU vessels going for recycling must have an IHM and, over the period 2015-2018, all new EU vessels must have an IHM. By December 31 2020, all EU existing vessels and non-EU vessels calling at EU ports must have an IHM. The EU SRR is in line with Hong Kong Convention requirements, with specifi cs for the EU region and EU-fl agged ves-sels, and will be implemented without waiting for ratifi cation of the Conven-tion.

The key characteristics of a quality IHM are a detailed visual sampling check plan in which samples are gathered and clearly marked by qualifi ed hazmat ex-perts, with equipment types and models verifi ed against original documentation. Proper IHM maintenance needs to dem-onstrated through an updated IHM.

The Regulation states the responsibil-ity of ship owners clearly: “Ship owners shall be responsible for the ship and shall make arrangements to maintain that ship in compliance with the requirements of the administration of the Member State whose fl ag the ship is fl ying up until such time as the operator of the ship re-cycling facility accepts responsibility for that ship.”

General requirements for shipowners include the preparation of documenta-tion with all ship-relevant information for the development of a Ship Recycling Plan by the operator of the ship recycling facility.

Shipowners should also ensure that ships are recycled at facilities included in the European list, these being yards that have been audited to ensure true compliance with the regulations. Weekly reports on recycling progress are re-quired as well as a fi nal document of completion, including an auditable trail for hazardous material.

“Independent and qualifi ed third-party supervision in the process of green re-cycling can assist responsible owners to achieve the objectives of green recy-cling,” said Bhargava.

“Some ship recyclers have already up-graded their facilities, but most recycling facilities still violate the Basel Conven-tion’s standards for disposing of hazard-ous materials and have a long way to go,” said Aulbert. He noted that while more sustainable practices are expected to increase the costs of ship recycling, the number of yards is expected to de-crease in the long run, and shipowners

could profi t from the regulation: “I think we will see more of a division between the practice of recycling itself and the sale of recycled materials. At the mo-ment, this is often still done by one and the same facility and shipowners often

choose one that will fetch them a high-er price for the recycled steel. The EU regulation allows shipowners to have a vessel recycled by one facility but sell their steel globally. This makes owners more independent from recycling facili-

ties regarding the profi t from the ship. The list of EU-vetted facilities will also give shipowners a better basis for decid-ing which recycling yard to use and can ensure that their vessels are scrapped in a sustainable way,” Aulbert concluded.

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SHIP RECYCLING

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Scrapyard in Turkey – note the concrete fl oor but the absence of a proper drainage system.

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The modern standard/future vision: A Chinese shipyard that builds, repairs and recycles vessels.

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